Development dollars bear close scrutiny

Published 3:43 pm, Monday, April 29, 2013

State Comptroller Kevin Lembo puts the issue succinctly. "We don't always look at what kind of return on investment we get on economic development," he said. To help change that, he's pushing legislation that would help open access to information concerning development incentives, including tax credits and other state aid, compared with the number of jobs created by those efforts.

If the return isn't there, the state should find a better way.

The Legislature's Finance, Revenue and Bonding Committee voted overwhelmingly earlier this month in favor of a compromise bill that helped temper opposition from the business community. There was concern that being forced to divulge certain data could put companies at a competitive disadvantage, so the bill was changed to aggregate numbers by industry instead of by company.

That's a good change. No individual companies should be hurt.

But the point of giving out tax incentives is to benefit that state as a whole. They shouldn't be given without good justification, and a track record of job creation should be part of that.

Lembo's bill would help create a database, accessible to the public, to keep track of statewide economic assistance programs and assess their impact. It's information the public deserves, and ought to demand. This is another tight budget season, and expenditures of taxpayer dollars should be closely scrutinized.

There's been some wariness from state officials charged with economic development, which is to be expected. One official said lawmakers must not hamper the state's chances of attracting companies by forcing them to disclose private information. That's a fair complaint, and one that has been addressed in the compromise bill moving forward.

There are also legitimate questions about whether the state should be involved to the degree that it is in trying to pick the future drivers of economic activity through incentives. That's a legitimate question, but it's not the one at issue here. Unless the state wants to unilaterally disarm -- which it doesn't -- then tax breaks and incentives will be part of the package.

The state needs to make smart and informed decisions on its development strategies. Transparency will not depress those job-creation efforts, it will ultimately enhance them. Everyone, including businesses, should have the best information on what has and hasn't worked in the past.